With the problem that we are going through with the economy these days, it is no surprise that more and more senior citizens are turning to reverse mortgages to help ensure that they can stay in their homes for the rest of their lives. But many of these senior citizens are getting into a reverse mortgage without understanding its benefits and pitfalls. Here are just a few of the pros and cons of a reverse mortgage so you can determine if this is the right avenue for you or your elderly loved ones.

A reverse mortgage may be a good idea for you if….
• You are planning to stay in your home for many years to come.
• You have no heirs to inherit your home after you are deceased or if you are not concerned about your home passing to another member after your family after you are deceased.
• You don’t have a steady income each month.
• You rely on your Social Security benefits to make your payments each month.
• You need expensive medical care and not having to pay your mortgage payments each month would be a great help financially.
• You want to sell your home in the future and you want to use the mortgage payments to make repairs and renovations to bring the house up to the current codes.
• You are worried about losing your home. With a reverse mortgage, you will not outlive the equity so you can stay in the home until you pass away or decide to move out.

A reverse mortgage is not a good idea for you if….
• You plan on moving out of your home soon.
• You want to pass your home down to your children or some other family member after you pass away. The home reverts to the mortgage holder who sells it upon death to pay the outstanding balance. There may be little, if any, money left over to pass down to the heirs.

These are just a few of the considerations you should make when thinking about entering into a reverse mortgage. Of course, every situation is different so it is best to consult with family, friends and financial advisors before making your final decision. Just remember to do your research and take your time as this will be a very important decision that affects you and your family long after you pass away.

With the mortgage industry still in a crisis, the Obama administration has proposed a number of plans to help mitigate the damages. One of those plans – the Making Home Affordable Program – has aspirations of helping upwards of 7 million people with their troubled mortgages. It is designed to decrease the number of foreclosures and delinquent payments to help the economy get back on its feet.

Another program – the Home Affordable Refinance Program – is expected to help about 4 million other troubled homeowners. This particular program will help troubled mortgage payers qualify for a home loan modification to help them afford their monthly payments. Under normal circumstances, these people would not be able to modify their home loans because their home’s value dropped drastically and the loan-to-value ratio would be more than 80 percent. But with the Home Affordable Refinance program, these same homeowners may be eligible for lower interest rates or modifications that change their adjustable rate mortgage to a fixed rate mortgage. Another viable option under this program is to extend their mortgage for another 30 years to make payments lower so they can afford them.

Officials are saying that instituting this program should not be much of a hassle for two reasons. For one thing, it will not require an appraisal of the mortgage payer’s home in many cases. This reduces the expense for customers and lenders alike. Also, the Government Sponsored Enterprises lenders already have the information needed to follow through with these modifications so gathering the information should not be a problem.

But how does one qualify for this type of program? Is it just enough to be in an underwater mortgage? Or are there some other qualifications? Here is some of the latest information regarding this new program and what it can do for you.

• You must have entered into your mortgage loan on or before January 1, 2009.
• You can only refinance the first mortgage loan on your home. If you have second or third mortgages, those are disqualified from the modification offer.
• Your principle balance is not affected. Only your interest rate will change.
• You can only refinance your primary residence.
• Your income will be used as a means to determine your eligibility. This includes pay stubs, tax returns and other documentation needed to prove your income.

If you are a troubled homeowner, why not try to take advantage of one of these programs? With mortgage rates at all-time lows, you may qualify for a better interest rate and save yourself thousands of dollars over the life of your loan. It’s definitely worth a try.

For the last several weeks, it seems as though the mortgage rates are playing a game of limbo...and winning. Every time you look at the most current mortgage rates for fixed rate loans, they have dropped below the historic lows that they were already at.

According to Freddie Mac, one of the leading companies that tracks mortgage rates, you can get a mortgage loan for 4.54 percent right now if you qualify. That means that if you have great credit, a good income and at least 20 percent to put down on your home, you may be able to get this historically low rate on a 30-year fixed rate mortgage. That rate is down about 0.02 percent from last week’s ending rate and down from the 5.25 percent rate that they were at one year ago.

If you are looking for an even lower rate, a 15-year fixed mortgage is at 4 percent for qualified buyers. That’s a 0.03 percent drop from last week’s rates and it’s a 0.69 percent drop from the rates from one year ago.

While these rates are super low, these aren’t the lowest rates you can get. If you shop around and you are a qualified home buyer, you may be able to find rates even lower than those if you are willing to check with various mortgage lenders before making your purchase. However, because of the recent mortgage problems we’ve had in the United States, lenders are being much more careful about who they loan money to. Freddie Mac and Fannie Mae have tightened the restrictions surrounding the types of loans they will purchase and guarantee. This means that mortgage lenders have to tighten their standards as well.

This means that you may not be able to qualify for these low rates even if you have had a mortgage for years and you are looking to refinance. Self-employed homeowners wishing to refinance so they can make home improvements are getting turned down for the best rates even though they have a good track record of payments. Many lenders are not offering premium loans and rates to the self-employed because they pose a higher risk than the homeowners and home buyers who have traditional jobs.

So as rates continue to drop, the question must be asked: How low are they really going to go? There was a time just a couple months ago when we thought mortgage rates wouldn’t go back down for a while. Now they are at their lowest levels yet and they have dropped for six straight weeks. How much lower do you think they can get?

There was a time not too long ago when consumers would refinance their homes so they could get money from the equity they have built up and get that money back in cash. They would then use that cash to buy some toys, such as boats, RVs or long vacations. But in the last couple years, there has been a trend to do just the opposite. Many homeowners are actually putting up more of their money when they refinance and putting that money toward closing costs and their mortgage rather than using it for something less responsible.

Many of these homeowners who have decided to do this see the historically low mortgage rates as a chance to save money over the term of their loan. Homeowners who have an extra chunk of money sitting around are putting that chunk toward refinancing their mortgage. This brings their total balance of the mortgage down considerably and saves them money over the life of the mortgage. Combined with the mortgage rates which are well below 5 percent right now, it’s an added bonus for them.

People simply aren’t investing their extra money in other products, either. CD rates are not doing so well right now and the federal government probably won’t be raising those rates for awhile. Fewer people are leaving their money or putting it in the stock market anymore either because of its volatility and uncertainty. As a result, they are turning to something they know is secure and will save them money – their home.

Mortgage rates fell to about 4.56 percent for 30-year fixed loans for the week ending on July 22. Those rates are the lowest they have been since they began being tracked nearly 40 years ago. Rates for 15-year fixed mortgages also fell to record lows at 4.03 percent.

If you have been considering cashing in on your refinance rather than cashing out, here are a few reasons to help you make your decision:

• You can change your 30-year fixed mortgage to a 15-year fixed mortgage and your payments won’t be too much more than they are now.

• You may be able to stop paying PMI if you are putting at least 20 percent of a down payment on your home. This will save you money each month as well.

• Bringing cash to the table when you refinance may bring your mortgage loan below the conforming loan limit so you may be able to avoid paying higher jumbo rates.

Weigh all of your options before making your decision and find out how bringing extra cash to the refinancing table can help save you money. Make smart decisions with your money now and you may be able to splurge a little bit when it comes time to retire.

With the historically low mortgage rates going on right now, it may be easier to sell your current house and upgrade, downgrade or move across the country and make some money at the same time. One of the keys to selling your home, however, is staging it correctly. The first impression that potential buyers get from your home can play a major role in their decision to buy it or keep looking for something better. Here are four tips you can use to stage your home so potential buyers will put it at the top of their list of houses they want to buy.

1. Paint the rooms with neutral colors. You might think that bright orange paint looked good in your kid’s bedroom, but what if the potential buyers don’t have kids? Or what if they hate the color orange? Make sure each room is neutral by painting with earth-toned colors like beige, sage, light blue, vanilla and others. This makes it easier for buyers to imagine each room with a fresh canvas so they can make it their own in their minds without being given preconceived notions about what you used the room for.

2. Make the beds. Leaving the beds in the bedrooms of the homes will make it look homey and the potential buyers will be able to picture themselves sleeping in those rooms. Make your beds the focal point of the bedrooms by using new, fresh sheets, blankets, shams and comforters. Use coordinating solid colors or simple patterns that won’t distract from the bedroom’s surroundings.

3. Hide the pictures. Having pictures of family and friends around your home is great while you are a living there, but they can distract potential buyers from focusing on the rooms, space and potential of the home. Photos are too personal so you should always have them boxed up when showing your home to buyers.

4. Make it smell good. One common trick to staging a home is to bake cookies in the oven before potential buyers arrive for a showing. This gives the house a homier atmosphere. If you don’t have time to bake cookies, you can simply use some vanilla or apple cinnamon scented candles strategically placed around the house. Plug-in scents are also ideal and affordable for giving your home the aroma that buyers will appreciate.

There seems to be some good news coming down the pike for troubled homeowners and potential homebuyers. As for those looking to buy a home, mortgage rates have fallen for the sixth consecutive week to historic lows. Just when it seems like they can’t get any lower, the drop again. Now is the time to get into the housing market if you have been pondering buying a new home.

As for troubled homeowners, the federal government has just approved another $1 billion allotted for people who are having problems making their house payment as a result of medical conditions or unemployment. The program, titled the Emergency Mortgage Relief program, is designed to help troubled homeowners who are three months behind or more on their mortgage payments. These homeowners can be eligible for as much as $50,000 each in federal loans so they can pay their mortgages.

In addition to this $1 billion, the federal government has two other programs designed to help homeowners when they become unemployed after getting a mortgage. The Treasury Department offers more than $2 billion to troubled homeowners in the states that have been hit the hardest by unemployment. In June, the department gave out $1.5 billion in five states and it has another $600 million for giving out in the next few months. The Home Affordable Employment Program is another program designed to make mortgage payments more affordable through forbearance. Homeowners must be at least three months behind in their payments to qualify and the unpaid amounts can either be repaid in different ways or it can be added to the outstanding balance of the mortgage loan.

The newest program, however, still needs to have some details hammered out. It isn’t clear how homeowners can get money from this new program, which was actually created in 1975 under the Emergency Housing Act. HUD will more than likely be the agency providing the assistance to homeowners who have either had their hours cut way down at work, become unemployed, or become unable to make their mortgage payments due to a health issue. In addition to being three months or more behind in payments, the homeowners must also have a reasonable capability to resume mortgage payments in the near future in order to qualify for the financial help.

HUD spokesman Lemar Wooley said that the agency is still reviewing the legislation before making any comments on how the decisions will be made as to who will be eligible for the aid and who will be ineligible.

Have you ever heard of such a thing as “housing counseling”? Before the housing crash of 2008, that term was probably unheard of by a huge majority of people in the United States. However, with the problems that have occurred in the mortgage industry as of late, housing counseling is becoming a common term and something that potential homebuyers are seeking.

The Department of Housing and Urban Development, or HUD, has announced that it is providing nearly $80 million for housing counseling. The program is designed to help families who find themselves in financial trouble stay in their home. It will also help potential homebuyers realize the responsibility of their mortgage payments. It will also help them find home mortgages that they can afford. The money is a 27 percent increase over the money that the department offered last year for the same type of counseling. That’s an indication of how bad this type of program is needed.

The money is going to be used by HUD-approved counseling agencies across the nation. It will also be offered to State Housing Finance Agencies which provide help for troubled mortgage payers who face foreclosure. The agencies also provide help and support to help consumers avoid mortgage scams, increase their credit scores, qualify for mortgages and other types of support.

According to HUD Secretary Shaun Donovan, the money is designed to help programs that will reduce the number of foreclosures. These programs help families make better choices through providing them with information that leads to educated decisions. The programs are not only for families who own homes, but also for renters who are considering a home purchase as well as homeless families or individuals.

Before receiving counseling, though, the agencies must send the families or individuals information packets with materials relating to mortgages, home ownership and other topics so the clients can read the information and have questions when they arrive for the counseling sessions.

Does this sound like something that might help you in your quest for owning a home or preventing foreclosures? If so, you can visit the HUD website to get more information about how you can sign up for a housing counseling program at an agency near you. With mortgage rates this low, you should jump at the opportunity to get into the housing market if you can because you never know how long they are going to stay this low or if these rates will ever come back again.